When President Bush pushed the Class Action Fairness Act (CAFA) through Congress in 2005, environmentalists lamented the demise of the one of the last robust incentives for energy companies to develop meaningful safeguards against environmental disasters. At the time the bill was passed, one headline presciently read, "Erin Brockovich, drop dead."
BP executives should be relieved to find that her legacy is still buried six feet deep in oil sludge.
In recent weeks, Congress and the president have been roundly criticized for their slow response to the Deepwater Horizon rig explosion in the Gulf that triggered one of the worst environmental disasters in U.S. history. Gulf residents, meanwhile, have brought well over 200 lawsuits relating to the April 20 oil spill. Many of them were class action suits that were forced to be filed in federal district courts pursuant to CAFA.
The bill, one of the Bush administration's prized legislative victories for large corporations, effectively stripped state courts of jurisdiction to hear multistate class action suits. The problem, Congress perceived at the time, was a culture of plaintiff-oriented bias in state courts whose judges routinely awarded victims maligned by corporate malfeasance millions of dollars in damages.
Proponents argued that the bill could cut down on the so-called practice of "forum-shopping" whereby plaintiffs' lawyers sought out state judges sympathetic to local interests in hopes of recovering larger settlements. Federal judges, the argument continued, had greater resources to deal with large class action suits and were best positioned to assess equitable, unbiased remedies.
After CAFA was signed into law in 2005, almost every claim related to an environmental disaster was filed in federal court. In most instances, cost structures prohibit individual filings in state court because defendants in environmental disaster cases usually cause a small amount of harm to a large number of people.
Aggregating similar claims into a class is the only cost effective means of ensuring that those harmed by environmental disasters, like the Gulf coast fishermen, have their day in court.
Yet, with any environmental disaster, time is of the essence. With each passing week reports related to the BP oil spill surface of fisherman filing for bankruptcy, marina owners shutting their doors and cleanup efforts stalling for lack of funds.
And yet this kind of situation was precisely the reason the business community lobbied Bush so hard for CAFA in the first place.
Federal courts, whose dockets are already largely overburdened, lack the capacity to expediently settle disputes. As a result, cases languish for years. In state courts, where the vast majority of civil suits are filed in the U.S., cases tend to settle much quicker; usually through default judgments and pre-trial settlements.
By funneling multistate environmental class action suits into federal court, CAFA has made it far more expensive, burdensome and time-intensive for Gulf state residents to recover damages from the oil spill. The cost of spending years in federal court may deter many from filing claims against BP at all.
Congress must revisit the legislation and exempt environmental class action lawsuits from CAFA. Twenty years after Exxon Valdez ran aground in the Prince William Sound, coastal residents in affected communities are still waging fights to recover lost income and damaged property.
Instead of finger-pointing, Congress can easily play a meaningful role in supporting local cleanup efforts and jump starting ailing economies in the Gulf. By allowing environmental class action cases to be filed in state courts, Congress can take the first of many steps in hopes of reviving Ms. Brockovich's legacy.
Drew F. Cohen is a third-year student at the George Washington University School of Law and a senior editorial board member of the George Washington Journal of Energy and Environmental Law. His e-mail is email@example.com.